Section 3: NoTWITHSTANDING anything contained in the Licence or the 1951

Agreement but subject to the provisions of Clause 4 hereof the Company shall be liable to pay Sierra Leone income tax at the standard rate from time to time in force and in computing the profits of the Company for any accounting year for the purposes of Sierra Leone income tax the following provisions shall have effect that is to say- (a) The Diamond Industry Profit Tax chargeable on profit for that year shall be allowed as a deduction. (b) The Company shall be entitled if it so desires to deduct all or any part of capital expenditure incurred during that year to up a total of £200,000. (c) Capital expenditure deducted under sub-paragraph (b) above shall not be the subject of any capital allowances and (d) Any capital expenditure not deducted under sub-paragraph (b) above shall be the subject of capital allowances (namely initial allowances annual allowances and balancing allowances or balancing charges) at the rates and on the basis applicable and from time to time in force in relation to such capital expenditure under United Kingdom income tax law. (e) In the event of the sale by the Company of any assets the cost of which has been allowed as a charge against profits under sub-clause (b) The Company to pay Sierra Leone Income Tax. 2176 Cap. 209] Diamond Agreement (1954) --------------------- Overriding Limit of Taxation. Income Tax not to be discriminatory. Suspension of the 1951 Effective date of New Tax arrangements. Double Taxation Relief. Kono Area contribution. Illicit Diamond Mining and Trading and Diamond Stealing. Diamond recovery. of this clause, so much of the proceeds of such sales as do not exceed the amount which has been allowed as a deduction shall be included in computing profits of the Company for the year in which the sale is made.